Bitcoin Ordinal Inscriptions Hit $7.6M—Gas Fees Skyrocket

On Tuesday, the total payments for Bitcoin Ordinal Inscriptions hit 272 BTC (around $7.6 million), according to Dune Analytics. In addition, more than 372,000 new entries contribute to the record-breaking amount of 682,281 daily transactions on the network, causing fees to top 23 BTC (around $656,000).

Quick Takes:

• Bitcoin daily transactions are skyrocketing following the BRC-20 token standard and Ordinals protocol. This week alone, the blockchain network has seen 682,281 daily transactions and fees amounting to 23 BTC (around $656,000).
• Recent data from Mempool shows that memory usage on Bitcoin now surpasses 650 MB — more than double its inaugural 300MB capacity.
• The network’s high demand has the potential to make running a node more challenging. However, proponents of Ordinals believe that the surge “secures and strengthens the network.”

The Outcome of Bitcoin Transactions Skyrocketing

The sudden surge in daily Bitcoin transactions is attributed to the BRC-20 token standard. Since launching in March, the network has enabled the minting of other digital assets and meme coins, resulting in 1 million new inscriptions being minted in less than a week, adding to the existing 2.5 million inscriptions.

The demand for Ordinals assets is the cause of there being a 700% increase in gas fees, amounting to 23 BTC (around $656,000):

BRC-20 assists toward the creation of the new Ordinals protocol. Bitcoin NFTs are sparking a new wave in minting assets on the blockchain as a consequence. But, despite there being an influx of “JPEG” files, many inscriptions (especially older versions) are text-based.

The reason behind many inscriptions being text-based includes being more cost-effective. Fees are based on data size. Consequently, JPEGs and digital media files cost more, thus, reach lower volumes.

Nevertheless, recent data from Mempool shows that memory usage on Bitcoin now surpasses 650 MB — more than double its inaugural 300MB capacity, hinting at the minting of more “JPEG” files on the network.

The Mempool report highlights the demand for a larger block size due to the surge in transactions. This, in turn, will make running a node more of a challenge. However, proponents of Ordinals state that the demand for the assets “secures and strengthens the network.”

Interestingly, however, elevated fees are beneficial for the Bitcoin blockchain. These costs encourage miners, bolster network security, and prioritize valuable transactions.

Providing the value obtained from minting outweighs the worth of inscription fees, Bitcoin transactions will continue to rise.